Skip to main content

Free look up period in an insurance policy

 Free-look gives you a second chance to review your policy and return it if you feel you misunderstood or were missold the plan
 

A good merchant gives you some time to review your purchases and exchange them if you are dissatisfied. Your bill, other than costs, also mentions the terms and conditions and the time period during which you can bring the goods back for an exchange. A similar practice is prevalent in the insurance industry as well, but here it's a mandatory condition that insurers have to follow. By law, they are required to give you a window, or what's also called the free-look period, to review your policy and if you are dissatisfied, return it and get your money back. Free-look is an important feature as it gives you a second chance to review your policy and understand what you have bought and also return it if you feel you misunderstood or were missold the plan. Here is more on free-look period in life and health insurance policies.

In Life Insurance
The process of buying a life insurance policy starts with filling up the proposal form. The form tells the insurer all that it wants to know about you in order to insure you. You would also need to submit additional documents such as proof of income and other know-your-customer (KYC) details. Often, at this stage, you also pay the first-year premium for the policy. After this, depending on factors such as the product you have chosen, your age and the sum assured, the insurer may ask you to undergo medical tests. These tests are paid for by the insurer. Once the insurer agrees to insure you, it will dispatch the policy documents. The free-look period kicks in from the time you receive the policy document. The insurer has to give you a window of 15 days to review the policy documents. If you are not happy, you can return these. The insurer will then ensure that you are within the 15-days window and then subsequently deduct costs for insurance cover for that time, stamp duty charges for issuing a policy bond and costs of medical check-ups, if any, and reimburse the difference.

In Health Insurance
Health insurance policies, too, are required to offer a free-look period of 15 days. Typically, health cover is an annual contract, which you renew every year. Free-look only applies to the first-time purchase and not to renewals. It kicks in from the time you receive policy documents. If you return the policy during this time, the insurer will pay the premium net of costs such as stamp duty and insurance for the days you were covered. Unlike life insurance policies, the insurer bears at least 50% of the cost of medical tests for medical plans that are renewed every year. This cost which will be deducted from the premium as well when it returns the money if you return the policy. Health plans such as indemnity policies, defined benefit policies such as critical illness plans and personal accident policies come with a 15-day window. But there is one exception to the rule. If the policy is issued for a period of less than a year, then the free-look rule is not applicable. Shorter-duration plans are, typically, travel insurance policies given for durations of less than a year.

The period depends on the number of days of travel. But if you have a travel policy that covers you for a year, as is with travel insurance for students, the free-look applies.

-----------------------------------------------
Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

Top 10 Tax Saving Mutual Funds to invest in India for 2016

Best 10 ELSS Mutual Funds in india for 2016

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Franklin India TaxShield

4. ICICI Prudential Long Term Equity Fund

5. IDFC Tax Advantage (ELSS) Fund

6. Birla Sun Life Tax Relief 96

7. DSP BlackRock Tax Saver Fund

8. Reliance Tax Saver (ELSS) Fund

9. Religare Tax Plan

10. Birla Sun Life Tax Plan

Invest in Best Performing 2016 Tax Saver Mutual Funds Online

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

---------------------------------------------

Leave your comment with mail ID and we will answer them

OR

You can write to us at

PrajnaCapital [at] Gmail [dot] Com

OR

Leave a missed Call on 94 8300 8300

-----------------------------------------------

Popular posts from this blog

What is Electronic Clearing Service (ECS)?

  As the name suggests, it's an electronic process through which money can be transferred from one bank account to another. According to RBI, this mode is usually used for regular payments and receipts, like distribution of dividend, interest, salary, pension etc. This mode is also used for collection of bills for telephone, electricity, water, various types of taxes, payment of EMIs , investments in mutual funds , payment of insurance premium etc. There are two types of ECS , like most other banking transactions, ECS credit and ECS debit. An ECS credit is used by a bank account holder , usually a large company or an institution for services like payment of dividend, in terest, salary, pension etc. If your mutual fund pays you dividend to your bank account, of all probability it is being paid through ECS credit.ECS debit, on the other hand, is used when a company or an institution is getting money from a large number of people. For example if you are investing in a mutual fund sc...

WEALTH TAX

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 WEALTH TAX   WHAT CONSTITUTES WEALTH? For wealth tax purposes, "wealth" means property , urban land, car, jewellery , yacht, boat, aircraft and cash in hand in excess of Rs 50,000. CAUTION POINT | Do not think you will have an easy escape from wealth tax by transferring your `wealth' without consideration to your spouse or minor child. Such assets will also be considered as your wealth. HOW TO DETERMINE YOUR TAXABLE WEALTH Add the taxable value of the above assets (computed as per the detailed rules for valuation) owned by you as on March 31 (for FY 2014-15, it will be March 31, 2015). In case you sold your car during the year, it will not be taxable wealth. Deduct loans if any obtained by you to acquire any of the taxable assets from the value of gross tax out for at least 300 days in a...

Equity Savings Fund

Invest Equity Savings Fund Online   The best part about these funds is that they are subject to equity fund taxation and at the same time are structured like MIP like funds . This new category, equity savings funds , offer a little of everything. They allocate money to equities & equity related instruments, and fixed income. They aim to generate returns by diversification. Such funds invest in fixed income and arbitrage to protect the investors from short term volatility and equity for capital gains. The best part of these funds is that they are subject to equity fund taxation and at the same time are structured like MIP funds.   MIP funds however are subject to debt fund taxation. Investors Equity savings funds are suitable for the following: First time investors who seek partial exposure to equity with less volatility and greater stability Investors seeking moderate capital appreciation with relatively lower risk Those wh...

How to Pick Top Performing Mutual Fund Schemes

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to Pick Performing Schemes  Funds that continue to stay in the top grade of performance over longer periods are the ones to bet on, advise investment experts   The mutual fund performance charts of the past few months make for an impressive reading. Funds across all categories boast of stellar returns. Sample this: The mid and small cap category has averaged 77 percent return over the past 12 months, with the best fund delivering a staggering 120 percent. The tax-saving funds also average an impressive 51 percent, including a fund which has soared 92 percent. Many of the table-toppers are funds of proven quality and track record. However, there are also schemes that are not that well-known. Some of these have rarely made it to the performance charts in the past, yet, of late, they bo...

8% Government of India Bonds quick guide

For those seeking comfort in safety of returns, the Government of India issued 8% savings bond once again comes to the fore. First launched in 2003, these bonds are issued by the government with a maturity of 6 years. The bonds are available at all times with specified distributors through whom you can apply to invest in them. Here is a quick guide to what the bond offers and its features to ascertain to check for suitability. What are Government of India bonds Government of India bonds are like any other government bonds with specified rate of interest. The rate is fixed at 8% per annum paid half yearly, or you can opt for cumulative payment of interest at the end of the tenure. You can buy these bonds from State Bank of India and its associates, other nationalized banks and some private sector banks such as HDFC Bank Ltd and ICICI Bank Ltd, among others. The bonds can be bought from the offices of Stock Holding Corporation of India as well. They are available in physical form onl...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now